Understanding Currency Trading Lots
Currency pairs are traded in units known as lots. A lot represents the specific amount of the currency pair being bought or selling.
Common Lot Types and Sizes
The three most common types of lots used in trading are the standard, the mini, and the micro lot. These types determine the volume traded based on units of the base currency:
- Standard Lot: Equal to 100,000 units of the base currency.
- Mini Lot: Equal to 10,000 units of the base currency.
- Micro Lot: Equal to 1,000 units of the base currency.
Detailed Summary
Currency pairs in trading are measured in standardized units called lots, which define the specific volume being traded. The text outlines the three most common lot types—standard, mini, and micro—and specifies the unit size of the base currency associated with each type.
Key Takeaways
- Currency trading occurs in standardized units known as lots.
- A lot determines the amount (volume) of the currency pair being bought or sold.
- There are three common lot types: standard, mini, and micro.
- A Standard Lot is 100,000 units of the base currency.
- A Mini Lot is 10,000 units of the base currency.
- A Micro Lot is 1,000 units of the base currency.